Uber London Ltd in the spotlight again for all the wrong reasons
Uber London Ltd has recently come under fire as the company’s accounts show they paid no corporation tax on profits made on the UK for 2014.
Uber have come forward to defend this stating that the low rate of tax is due them offsetting previous losses which is a legal practise.
In 2014 Uber London made £866,302 profits all of which, according to the company’s accounts, they paid no tax for. The company did however book £22,134 tax charge for the year and a spokesman claims was ‘deferred taxation relating to previous years’.
Sources say that The Independent had an accountant look at the books and they found that the company’s corporation tax was in effect ‘cancelled out’ due to the deductions they had for the costs of exercising share schemes with their employees. Employees making use of the share scheme would pay income tax and National Insurance of around 47 per cent which in turn provided the company with a deduction on corporation tax resulting in a zero figure.
A spokesman for Uber has denied that the company has used any loopholes or schemes to reduce its tax bill and claimed that Uber had paid “every penny of tax that is due”. “With corporation tax, past losses offset current and future profits – as is the case with Uber which made losses in the UK in previous years,” he said.
“This is an accounting principle to encourage investment that dates back to Benjamin Disraeli. It is not a loophole.”
“We are a young company – only three years old in the UK – that is investing heavily”.
“We are a significant net contributor to the local economy everywhere we go, creating new opportunities for thousands of professional drivers”.
“The lion’s share of every fare stays local, as it remains with the drivers who use Uber. And unlike the cash-in-hand past of this industry, we only take card payments so every fare is traceable and transparent.”
Multinational corporations have recently been under fire for exploiting loopholes and schemes to pay less tax such as Facebook who paid just £4,327 corporation tax in 2014.
